What was the net cash provided by operating activities for My Salon Suite in 2023?
My_Salon_Suite Franchise · 2025 FDDAnswer from 2025 FDD Document
Share-based compensation | - | - | 1,240,361 | - | - | 1,240,361 | | Net income | - | - | - | 9,668,250 | - | 9,668,250 | | Foreign currency translation adjustments | - | - | - | - | (100,769) | (100,769) | | Balance at December 31, 2024 | 1,000 | $ 1,000 | $ 363,125,409 | $ 79,627,020 $ | | (100,769) $ 442,652,660 |
Consolidated Statements of Cash Flows
| ` | 2024 | 2023 |
|---|---|---|
| Operating activities | ||
| Net income | $ 9,668,250 | $ 12,569,087 |
| Adjustments to reconcile net income to net cash | ||
| provided by operating activities: | ||
| Bad debt recovery, net | (85,758) | 429,277 |
| Depreciation & amortization | 10,981,870 | 4,502,473 |
| Share-based compensation expense | 1,240,361 | 1,144,951 |
| Gain on sale of assets, net | (16,112) | - |
| Capital asset impairment | - | 323,146 |
| Bargain purchase price gain on acquisition | (34,687) | - |
| Intangible impairment | 62,667 | - |
| Deferred income taxes | (796,605) | 182,406 |
| Amortization of right-of-use asset | 5,445,542 | 4,322,294 |
| Changes in operating assets and | ||
| liabilities, net of businesses acquired: | ||
| Accounts and notes receivable, trade | 17,519 | (715,354) |
| Amount due to/from affiliate | (146,517) | (494,880) |
| Prepaid expenses | (804,878) | 635,960 |
| Other assets | 207,052 | (817,899) |
| Income taxes payable | 1,738,564 | 3,038,140 |
| Accounts payable | (1,294,518) | (353,661) |
| Accrued liabilities | (1,665,508) | 4,598,741 |
| Other long-term liabilities | (1,302,860) | (538,612) |
| Deferred revenue | (1,547,373) | (753,097) |
| Operating lease obligation | (3,679,126 ) | (3,407,709) |
| Net cash provided by operating activities | 17,987,883 | 24,665,263 |
| Investing activities | ||
| Capital expenditures | (6,098,198) | (2,715,270) |
| Proceeds from sale of assets | 333,181 | - |
| Acquisition of a business, net of cash acquired | (81,095,967) | (6,784,799) |
| Net cash used in investing activities | (86,860,984) | (9,500,069) |
| Financing activities | ||
| Payments on finance lease | (23,369) | (36,863) |
| Net advances fr |
Source: Item 17 — (r) of the FDD and Section 13 of the Franchise Agreement disclose the existence of certain covenants restricting competition to which Franchisee must agree. The Commissioner has held that covenants restricting competition contrary to Section 9-08-06 of the North Dakota Century Code, without further disclosing that such covenants may be subject to this statue, are unfair, unjust, or inequitable within the intent of Section 51-19-09 of the North Dakota Franchise Investment Law. The FDD and the Franchise Agreement are amended accordingly to the extent required by law. (FDD pages 230–274)
What This Means (2025 FDD)
According to My Salon Suite's 2025 Franchise Disclosure Document, the net cash provided by operating activities in 2023 was $24,665,263. This figure represents the cash flow generated from the company's core business operations during that year. It is calculated by adjusting net income with non-cash items and changes in working capital accounts.
For a prospective My Salon Suite franchisee, this indicates the brand's ability to generate cash from its operations. A positive and substantial net cash flow from operating activities, such as the $24,665,263 reported for 2023, suggests that the company is effectively managing its revenue and expenses. This can be a reassuring sign for franchisees, as it implies financial stability and the potential for continued support and growth.
It's important to note that while this figure provides a snapshot of My Salon Suite's financial health, it should be considered alongside other financial metrics and industry benchmarks. Franchisees should also investigate how these operating activities translate into support and services provided to individual franchise locations. Understanding the factors that contribute to this cash flow, such as revenue from franchise fees and ongoing royalties, can provide further insight into the overall health and sustainability of the My Salon Suite franchise system.